Guest Post: In Defense Of The Corporation

Today, the government of the USA is in an accelerating transition. For the first 100 years (with a few exceptions) the government of the USA existed to set man free from men. The rights of the people were respected by the law and by the courts. And it is no coincidence that the USA grew from a small agrarian society in the 18th century to a wealthy superpower barely a century later.

But today, the government is taking control over every facet of the economy: sector by sector, law by law, regulation by regulation, court decision by court decision, czar by czar, presidential diktat by president diktat.

In this environment, formerly good and honorable words like “police officer”, “banker”, and “corporation” have taken on negative connotations as people become aware of the nature of our present system. The evil is not in the fact of being a police officer; it is in the nature of enforcement of bad laws (and neglect of enforcement of good laws). It is not in the nature of lending (i.e. exchanging wealth for income), but in helping the central bank create inflation (i.e. counterfeit credit). It is not in the nature of forming a large-scale enterprise, but in buying coercive powers and in forming an evil alliance with government.

By Corporation, I do not refer to the modern parasite that latches onto the government, seeking to coerce its customers, destroy its competitors, and feed at the public trough. Benito Mussolini coined the term for this system—fascism—though of course he did not regard it as the terminal stage of civilization. People today also call this “crony capitalism”, a term I don’t favor, as it is not any kind of capitalism at all, but the negation of capitalism.

Ayn Rand once noted that, “civilization is the process of setting man free from men” (“The Soul of an Individualist” in For the New Intellectual by Ayn Rand). When the government abandons its legitimate mission of protecting the individual rights of life, liberty, and property and instead institutionalizes their violation, then that society is reaching the end. What inevitably must follow next is the disintegration of the specialization of labor and then collapse of the civilization back into a dark age. Without the specialization of labor, each man must learn to produce—and physically labor to produce—everything he needs on his own, using only the resources of the patch of ground he happens to be on. This relegates him to the level of a beast, and under such conditions life is short and miserable.

It is in this light that I offer my two (gold!) cents about the nature of the corporation. Stripped of its pejorative connotations—and of the looting of the current system—what is a corporation? Earlier, I noted that a corporation is a large-scale enterprise.

Let’s begin there. I will first propose something that I think should not be controversial. The production of certain goods and services requires a large scale. There is no such thing as a local subsistence computer chip manufacturer. Intel does and must operate on a world-scale. Only at this scale is it possible to pay for the vast research and development necessary for a chipmaker. Only at this scale can a factory produce such small and delicate things as computer chips.

The same thing applies to an airline, or even food production. We take for granted today that we can go to a supermarket and buy almost any fruit or vegetable at any time of year, any meat, or processed food. It will be safe, and it will be affordable to a wage earner. This was not true 100 years ago, and it is not true in many places in the world today.

What are the requirements of operating at large scale? One needs a large amount of capital (more than one man could provide), large numbers of employees, and large numbers of customers. Let’s look at these in order.

What are the requirements of raising a large amount of capital from strangers? First there must be a business plan that promises a good chance to pay the investor a good return on his investment. And there is something else. The investor understands that the money he invests is at risk. But beyond that, he will not willingly risk his life’s savings, house, and his family legacy. If investing an ounce of gold necessarily put the other 99 ounces he owned at risk, then no one would invest, period. The investor has a choice of how to pursue his goal of exchanging income for wealth. He can always fall back on hoarding during his working career and dishoarding in retirement. The entrepreneur, on the other hand, has no choice. If he cannot raise capital from investors, he cannot get into business (or expand his business beyond his workshop).

What about hiring a large number of employees? With each hire, the company incurs a risk of loss due to any number of factors including if the employee is injured, the employee causes an injury to someone else, the employee damages the company’s property or the property of a third party, etc.

The same issues apply to selling at world-scale, to numerous customers all over the world. If a customer is injured due to faulty product design or manufacturing, if customers change their taste and refuse to buy a product which has been manufactured in large quantities in anticipation of big sales numbers, a competitor sues for patent infringement, or any number of other things happen, the company incurs a risk of loss.

One of the requirements of operating at large scale appears to be in conflict with two other requirements. To raise money from investors, there must be a limitation of liability. To hire a large workforce and to sell in large volumes incur risk of loss that could exceed the company’s capital.

I propose for consideration by the reader a statement that I realize is controversial today. I propose that the only solution for the above three constrains is the limited liability corporation. Without the limitation of liability, it is not possible to operate a business at larger-scale than a family workshop. It would be possible to make shoes, barrels, swords, and all of the other goods of the Dark and Middle Ages. It would not be possible to reach the Industrial Revolution, much less to produce refrigerators, cars, computers, or the Internet.

In addition to the limitation of liability, there is another important attribute of the corporation. The corporation itself owns its capital such as money, land, buildings, tools, inventory, etc. And the corporation is the party of record in contracts such as with landlords, suppliers, customers, banks, etc.

This is the other controversial aspect of the corporation. For legal purposes, a corporate entity is a “person” with the rights of speech, liberty, contract, and property. As described above, it would not be possible to operate a business larger than a family workshop if each tool had to be owned by a person (a wage earner?), each contract had to be signed personally by a person (a manager?), and each debt incurred by an individual person (one of the investors?) It is the corporation as such which engages in production, owns its means of production, sells its output, contracts with other parties, etc. It is not merely a loose confederation of family workshops in a cottage industry, wherein each is an independent entity.

Thus we must conclude that our modern, industrial, information-age civilization with its advanced transportation, communication, health care, and other technologies literally owes its existence to the limited liability corporation that has the rights of personhood. Let us all work towards the day when the corporation returns to this definition and is no longer a large-scale parasite, seeking ill-gotten gains at the public trough.

The Berlin police force is preparing to break in its new high-tech water-cannon monster-truck for the annual May Day protests in the German capital, with demonstrations and clashes expected to begin on Monday night.

Residents of France who work across the border in Geneva have become the targets of a virulent anti-migrant campaign calling for their houses and cars to be burned.

Some 90,000 foreigners, most of them French, cross the border to work in Geneva, sparking tension in an area with the highest unemployment in Switzerland - 5.3 percent in March, against a national rate of 3.2 percent.

A pamphlet distributed this month outside the Geneva University Hospitals calls for the elimination of "this border scum".

"They are everywhere... in a number that far exceeds the tolerable quota, with their arrogance, their pollution, their contempt, their insolence and their privilege," the pamphlet said.

"Total war is declared," said the tract, which was reprinted by the local Socialist Party in a newsletter expressing alarm over the document's violent nationalism. "Burn their houses, their cars. Border workers, get out."

I agree with the earlier poster, it's nice to see this issue addressed, even if I don't think the article's author has thought it through sufficiently.

His principle argument is that no one will invest their money if loss arising from that investment is not limited to the amount invested.

And yet we all routinely embark on activities that entail much higher risks than we are initially investing. Marriage, children, getting training in a specific field, just going out for a drive - as individuals, unprotected by the government, we could all face catastrophic loss arising from these undertakings.

And, morally, exactly why should your liability be more limited than anyone else's just because you've formed a corporation?

We have auto insurance to sheld us from making ruinous payouts in the event we wind up causing a massive accident. I don't see why similar free-market mechanisms wouldn't arise if we took away corporations' privileges - privileges that only arise because the state grants them.

Furthermore, let's examine some instances of corporations and what they produce. The author makes the mistake of lumping the potential risks of all corporations together. Yes, you need a large scale enterprise to produce computer chips. But the risks arising from their production is fairly small - and, consequently, liability insurance would be consequently small, say, compared to a corporation drilling for oil in the Gulf of Mexico, or producing power from a Uranium/Plutonium fission plant.

'Investor insurance' - to cover your ass if your investments wind up causing massive damage to other people's property or lives. Your premiums would reflect the risk... which is at it should be.

There are powerful advantages to having large corporations and the scale efficiencies they allow, and as the author points out some industries would not be possible without the LLC. More to the point, any society that harnesses these efficiencies will be able to dominate any society that does not.

Problem is, when crony-capitalism crashes, people will blame the capitalism half and not the crony part.

It is understandable that the populace feels oppressed, because it is. The people blame corporations, when they should look to their own governments (and yes, the oligopolies that co-opted their governments). Government-controlled capitalism is called Fascism, and that is what we have, worldwide.

However, this essay attempts a clear statement to the contrary: "Economies-of-scale" is significant. Growth of an entity with access-to-resources is essential for some industries/product-pipelines. The result is prosperity.

Another thought would be that corporations similarly allow an individual with a good idea, and access to capital markets, to create an institution strong enough to defend itself from (government/beurocratic) oppression.

The best thing for any totalitarian system is to ensure all individuals are insignificant, and to deny their ability to become (or grow) anything beyond the single individual.

It takes an enormous amount of work, and fabulous logistics, to kill millions of people. That's why throughout history such a job is only performed by governments, and not corporations.

So yes, the populists are correct that the "too-big-banks" and "too-big-Monsantos" are killing the people, but that's only because they've co-opted the governments into Fascism. The problem with that relationship, however, isn't the corporations (though they are at fault). Rather, the problem is with the governments: Why on Earth do people think Government should have that type of power?

Remove that civil deference, and the fascist relationship collapses. Corporations then deliver value, or die.

Our only problem today is that corporations don't deliver value, and the governments choose to keep giving them money-and-power directly, and yes, that is killing their people.

Remove that civil deference, and the fascist relationship collapses. Corporations then deliver value, or die.

No doubt that has been true. Little by little however, the corporate attitude has taken over in America. There is no state, no government. The so called 'revolving door' wasn't something the State created. It's the opposite. First came Goldman then Treasury.

Corporations are getting better and better at seducing us into thinking the way they think—of profits as the telos and responsibility as something to be enshrined in symbol and evaded in reality. Cleverness as opposed to wisdom. Wanting and having instead of thinking and making. We cannot stop it. I suspect what’ll happen is that there will be some sort of disaster—depression, hyperinflation—and then it’ll be showtime: We’ll either wake up and retake our freedom or we’ll fall apart utterly. Like Rome—conqueror of its own people.’ --DF Wallace

I agree with the article in the sense that corporations are nothing more than just entities. It is what the entities do that matters. Families, individuals, governments and etc. can either be good or bad depending on how they are run. If we want our corps to be moral again, we need to change societies' values. If not, the corps. will continue to extract from the helpless to enrich the immoral and wealthy.

But beyond that, going back to the treasure secretaries, at least back to Andrew Mellion, then the 5th richest man in America when he was treasury sec'y through multiple administrations, they've all been a scurvy lot, some with direct relations to royalty (Dillon's daughter was Princess of Luxembourg, after all....).

Very clever, except that it completely misses the point. Stalinism was NOT a trasition of capitalism.

Fascism is a stage of capitalism, not communism.

It's a sad statement on the American educational system that so many people can't tell the difference between fascism and communism. Both systems being totalitarian does not make them equal. Of course some people still call China communist, so reality doesn't seem to make a difference here.

Big Jim wins the thread. Capitalism, Free Markets, corporations, and governments *always* get hijacked by the scum that wriggle their way to the top of the heap. Hell, the US Constitution, _as it was written_, was a fine & dandy idea for a government. "All other powers besides - essentially - delivering the mail, collecting tariffs, and (maybe) building interstate freeways are expressly reserved for The People"...got a nice ring to it, don't it? Even if they DID whomp it up in secret in the middle of the night, while telling the people they were doing something entirely different. Maybe that's what doomed it all right from the start.

But if the country were to run on its original, specifically delineated precepts - that means no fucking "judicial review", and "all powers not expressly given to fedgov belong to the states" for starters - we'd all be a lot more free and (hopefully) happier. We'd have a lot fewer wars under our belt, anyways.

But no go. That's the thing about rats & roaches: doesn't matter how deep you bury 'em, or how many you kill with the disinfectant of sunlight, you'll never get 'em all. They'll lay low, live on scraps and garbage, breed like flies and just wait you out. You'll get tired & give up before they will. And they **never** quit: so sooner or later, you've got yourself an infestation of vermin fucking up your once-glorious system/markets/corporations/governments. Like B follows A. The only question lef tis what's next? I ain't optimistic, either. At best, there's gonna be a lot of people having their lives and savings destoyed; at worst, there's gonna be a lot of dead US citizens.

A lot of the political arguments I see seem to work from the premise that there could be some ideal system, in which sociopaths couldn't wriggle their way into positions of power and start using its levers to subvert the system to their ends. So, when libertarians argue for minimal government, collectivists always (and correctly) point out that sociopaths will exploit the concomitant lack of regulation to fuck other people over. What the socialists never seem to realise is that bigger government's larger levers afford those same sociopaths even more power to fuck others over.

So... I don't think there is one, static, ideal, system... because it will always be subverted. I think this is what Jefferson meant when he said the tree of liberty needs frequent watering with the blood of patroits and tyrants. We, the people, have to be vigilant and continually hit the reset button whenever the system starts going awry, before it goes too awry.

Of course, people are usually too lazy, or simply calculate they have potentially much more to lose by rebelling against the system as it stands than just keeping shtum. So, in the early stages of systemic subversion, there is little resistance, because people are weary from the bloodshed that arose from the previous rebellion, and remember how much worse things were before the regime change.

However... kleptocracies rarely correct themselves, but become more corrupt over time, eventually forcing the majority of head-duckers to the conclusion that they really haven't anything left to lose anymore.

Technically and educationally speaking, Stalin's gov't was State Capitalism, while today China's gov't is Totalitarian Capitalist State, and the USA is a Corporate Fascist State --- I'll bet you had probs with arithmetic when you were a wittle boy.

It isn't government that owns the capitalists. It's the other way around.

I think it's a bit of both. When Microsoft didn't pay lobbying money to the government officials, they went after Microsoft. And they are going after the internet companies with SOPA, etc. If big corporations don't give the government officials lobbying money, the government starts going after them, I'm sure there are also cases of the corporations trying to buy off the government first.

So, it is probably the natural way for a system of representative democracy and corporations to end up with them in an evil alliance together benefiting themselves above the people.

I think several things could greatly alleviate this. First, giving the people the powers of recall and referendum would go a long way to fixing the problem. There are many checks and balances in our constitution, but we need a check and balance that gives the people more power to boot out corrupt politicians, and to veto bad laws. After all there is nothing more important than the government fearing the people more than the people fearing the government.

Second, perhaps making the CEO and board of directors personally liable could go a long way to making the corporations act like responsible citizens without stopping the economy of scale because it still exempts the shareholders from personal liability.

I think it's a bit of both. When Microsoft didn't pay lobbying money to the government officials, they went after Microsoft. And they are going after the internet companies with SOPA, etc. If big corporations don't give the government officials lobbying money, the government starts going after them, I'm sure there are also cases of the corporations trying to buy off the government first.

I understand that, and realize the absurdity of court rulings these days. I should have qualified my position by including a fair and impartial judicial system. Something I have not seen in my lifetime, but is rumored to have existed some where, at some time.

But how is that any different from any other person going about their day-to-day business?

Exactly why should your liability be more limited than anyone else's just because you've formed a corporation?

We have auto insurance to sheld us from making ruinous payouts in the event we wind up causing a massive accident. I don't see why similar free-market mechanisms wouldn't arise if we took away corporations privileges.

‘Corporations aren’t citizens or neighbors or parents. They can’t vote or serve in combat. They don’t learn the Pledge of Allegiance. They don’t have souls. They’re revenue machines. I don’t have a problem with that. I think it’s absurd to lay moral or civic obligations on them. Their only obligations are strategic, and while they can get very complex, at root their not civic entities. With corporations, I have no problem with government enforcement of statutes and regulatory policy serving a conscience function. What my problem is is the way it seems that we as individual citizens have adopted a corporate attitude. That our ultimate obligation is to ourselves. That unless it’s illegal or there are direct practical consequences for ourselves, any activity is OK.’ --DF Wallace

Not so. Corporations have long been considered legal entities, with rights and responsibilities under the law - just as you are likewise considered a legal entity, with rights and responsibilities under the law. The Citizens United ruling simply reaffirmed what was already known - it did not create a new definition.

I don't have a problem with corporations in general. The problem I have is they have all the politicians in their back pocket aren't allowed to fail or held accountable when they practice bad business behavior.

We will shortly see the grinding death of the small corporation (small business) and the rise of the mega-multinational combine. Thanks to the engineered biflationary squeeze on margins where cost of doing business and all input costs rise while consumers' incomes and net worth decline.

If you're in doubt, just check out latest earnings reports. Apple and the 35 largest US multinationals added jobs 3 times faster abroad than at home. And 60% of their revenue now comes from overseas

The objective of a corporation is to maximize profit for its shareholders.

Any and all means required to achieve this objective are fair game. There are many cases where these objectives conflict with the greater good of human life.

In some cases, the value of the quality of human life, even the value of human life itself is actually an externality, something to be disregarded so that the brimary objective can be achieved. (Slavery, Military, For Profit hospitals)

This is why there needs to be a careful review of the laws surrounding corporate personhood.

the purpose of any business is to maximize profits PERIOD. to have a solid business based on legitimacy of its service, not to create a fraud of a system that rewards the early inside investors to loot the late investors. Or engaging in selling worthless assets that are rated AAA by Government agencies who oversee these assets and have a vested interest in those assets succeeding no matter what is what the real problem is. go look at all the people who are in government that go to goldman sucks/ jpmorgan/ citigroup, etc..... Once the government allows, condones, and rewards these corporations for perpetrating fraud without punishment, then this will continue.

Your comments just signify the diseased nature of most of the discussion in this regard for the past 30 years. "even the value of human life...." Even when the alleged articulate and educated try to express some sober judgement about the sociopathic corporation (modeled on the European/Dutch, Portugese, British, American) SLAVE plantation they fall on their faces.

Douchebagger, had you ever studied your history you would realize that wasn't accurate --- the warriors existed prior to any governmental existence, and slavery was originally a corporate undertaking, thousands of thousands of years ago.

No, I meant all the protocols (TCP/IP, HTTP and so forth), formats (HTML etc), and most of the software (Unix, Linux, Apache web server) etc. Thousands and thousands of man years, worth a staggering amount if one had to pay for it. No corporation owns it or even a part of it.

DARPA was the government program that developed "TCP/IP," although it was crude in the early days. The revisions weren't done by "volunteers." They were done by people working at businesses that depended on the technology.

UNIX was developed to run big systems, again, not by volunteers. They were people actually earning salaries for their jobs at AT&T. They needed to do a lot of switching on the telephone network, also built at government sponsorship.

Apache was based on software built by an employee at a government-sponsored company for computing. It was re-written later to remove the original code-base.

HTML is vaguely "volunteer-built," but honestly, HTML kinda sucks.

That biggest reaon no one owns all this stuff is because no one knew how to patent software in the early days. The laws weren't there.

I know the government can't do anything, but it really did build the Internet.

let's throw the newborn out with the bathwater and call it a botched abortion - a defined limited liabilty for oligopoly sake!

indeed, banks [limited (frb) liabilities?] are corporations [conjoined twins] too, in this obtuse world of fickle modern finance? relatively speaking, the truth lies somewhere in-between,... indeed, in a literally symbiosis [tbtf/ congress] sense? so - let's just let em grow on the frb's balance sheet, shan`t we. which by the way, they've been sucking that teat dry for 100 years, and their corporate adopted offspring just can't__ever get enough of mother's milk - at the serfdom's [swear-on-my mother's grave, there wasn't a circle-of-poison sown?] organically farm`d market?

"By Corporation, I do not refer to the modern parasite that latches onto the government, seeking to coerce its customers, destroy its competitors, and feed at the public trough. Benito Mussolini coined the term for this system—fascism—though of course he did not regard it as the terminal stage of civilization. People today also call this “crony capitalism”, a term I don’t favor, as it is not any kind of capitalism at all, but the negation of capitalism."

BULLSHIT

This is capitalism you dim wits. You morons sound pathetic you really do. This isn't REAL CAPITALISM! REAL CAPITALISM HASN'T BEEN IMPLEMENTED CORRECTLY! Corporations are pure caplistlist in every sense of the term. They use their capital to invest in ventures that AQUIRE MORE CAPITAL. There is no cheating in capitalism, there is no boundaries. If the basic formula of using capital to aquire more is a success, than the system can CORRECTLY be referred to as a capitalist system.

This isn't corporations combining with the "State" This is corporations combining with MULTIPLE STATES GLOBALLY to guess what........MAKE A PROFIT.

You libertaritards are a bore, you're so dumb it is cringeworthy, don't worry though, you will get your small government only enforcing property rights soon enough.

This is the capitalist Utopia. You fuckers are in Denial at this point.

It's actually Fascism. Total Corporate Oligarch Control with Government Power. Or State sponserd Capitalism is called Fascism. Free markets have been vertically integrated into the To Big To Fail Fascist's.

AN, I agree with your post... someone prove that "we" are not alredy living the perfect capitalist dream... and to me, common sense has left the building... common sense is long gone when the "Albert Einstein's" of the world are far less regarded (and less paid) then the "Kim kardashian's"...

Personally, I am NOT a fan of big gov, social security, disability, free health care, high taxes, tons and tons of regualations; but one thing that I find difficult with the concept of libertarian-ism-- is how would it be any different then what we already have now... that is, the world we live in today works this way: whomever has the most money controls the gov... ok, so in a perfect libertarian world, then it's whomever has the most money controls the people??? just subtract the gov.

Either way it all leads to fascism or feudalism (why have a government who has police-- based on taxes, when "king Bloomberg, etc." could just pay for a private Army who pledge loyalty to him)... what if anything would stop such an end result... the people/ masses would just revolt and the system resets eventually (which, I believe we are currently experiencing in the world to some extent). I am not a socialist, a democrat, republican, or libertarian, but I do believe in common sense and analytic thought. I also believe in empathy, compassion, and imagination.

Basing a monetary system off something like the gold standard makes allot of sense. Corporate person makes no sense; and legal academics who make arguments in it's favor based on nothing other then circular reasoning, are wrong. Paying for the lowest/ poorest to get a free ride, does NOT makes sense. Free health care doesn't make sense-- but either do big pharm companies who cheat the FDA (and neither does a FDA with absurd standards for that matter) or lying about research to push drugs... and Health care companies that jack up prices, and refuse to pay medical bills (of their customers) due to legal loop holes, are horrible (and that's what we have in America)-- again, I don't agree with free health care; but exploitation (if that's capitalism- and how would that not be Rand's wet dream fantasy?) then we are living it currently in a perfect sense... all of the common sense is GONE... I could go on... and on... shoving sub prime loans down poor people's throats-- that is exploitation... MF global cluster fuck... and so on...

Paying CEOs (of banks or otherwise) millions/ billions to see their companies fail or take gov. bailouts is ludacris. Shipping whole industries off to 3rd world countries were wages are depressed and were no rules exist on pollution/ the environment; while the board of directors of said companies/ and it's business leaders collect millions, is utter hedonism that will have dire consequences.

Total lack of investment in the average person or the masses or the middle class, et al. (barring them from having a chance/ investment/ infrastructure- including the smart ones who may not have high SES's, but have high IQ's) with things like shifty student loans and investment bubbles and debt slavery is horrible... making access based to moving up the social/ economic ladder virtually impossible-- next to it solely or totally being based on luck or nepotism -- has always and will always destroy societies...

Modern society with rules and regulations is natural... regulated, markets -- and stopping things like monopolies or trying to stop things such as lobbying-- or letting people / workers have a fair wage-- is natural (again, who has the most money gets what they want-- stopping that sort of stuff) is truly the natural evolution of modern society... if it's not, then good luck... because it will be about who has the biggest guns/ who is the alpha male/ and there is no Geneva Convention in that world (fight or die-- survival of the fittest-- nothing separating humans from animals at that point)... that is, until we just evolve (back again from the fall of "Rome") to form a society (including equity markets) that are based on common sense... not based on: lying, cheating, stealing, tricking your way to the top, while exhausting all capital-- all so corporations can be people... it's all just history repeating...

For once I'm first. This is one of the most concise, profound, and properly explained what a corporation is, does, and why it is considered a person. Not enough, hell, hardly anyone understands this aspect of a corporation. Especially when you as an individual invest their money and the message/purpose of that corporation. Its free speech because you are speaking with your money and as we all know, money talks and bullshit walks. When you put your money where your mouth is you are speaking what you believe will work and you are participating with many individuals as a collective who believe in a specific goal. As an individual you have the right to pull your money/support for said corporation if you find out that it does something you don't agree with. that's free speech and that is why corporations are considered people not to mention that the origianl purpose is what is goood. It's the fallable humans who run them that is why some government is necessary, but follow the law and not only the one's that are convenient.

There's nothing wrong with the legal entity that we call The Corporation. The problem lies in the governmental structure of corporations. While the tippy top of the corporation maintains all of the power, no one is accountable for anything ... at least that's the way things have played out in recent history. A few points:

1. The corporate power structure stifles innovation and creativity of its employees.

Corporations are immortal. They can survive almost anything except economic depression. Because they are immortal they do not suffer from the ultimate deterent to bad behavior: Long-term imprisonment, or death.

We need a corporate death penalty, or corporate suspension of liberty. The latter could be as simple as multi-year suspension of operations, just like going to prison. Of course in many cases that is equal to death, so one becomes the other over long enough periods of time.

Get that written into the Constitution as a clarification to the 14th Amendment and watch corporations change how they operate.

"What are the requirements of operating at large scale? One needs a large amount of capital (more than one man could provide), large numbers of employees, and large numbers of customers. Let’s look at these in order."

Why is there no mention of the inputs and outputs of natural resources such as energy (oil and gas), minerals and metals, water, wood, stone, etc in his requirements stated? Those things are not "givens" or taken for granted considerations at all. In fact, the requirement for physical inputs and outputs, and energy are probably the most important requirement especially now that our society seems to be bumping up against many natural resource limitations. "Limited" concerns for a corporations liabilities, may be trumped by "Limited" natural resources to use as an input to corporate business models. Maybe this article just tries to provide cover for an economic mindset that would like to ignore diminishing natural resources and resource depletions and what can be expected as a result.

"Why is there no mention of the inputs and outputs of natural resources such as energy (oil and gas), minerals and metals, water, wood, stone, etc in his requirements stated?"

Those all fall under "large amount of capital". While the finite nature of natural resources is safely axiomatic (until we start mining asteriods, I guess), under a market system (the current construct for all natural resources I can think of), scarce resources will be priced according to their availability and abundance. For instance, at what point will you not be able to buy oil? Only when there is none left naturally and we have no capacity to create it synthetically. In 10, 50, 100, or 500 years will we run out? Maybe, I don't know, but until then, you'll certianly be able to buy it.

Axiomatic like in a given? Don't make me laugh. Hey you, ZH editor. You should do an article to debunk this asteroid mining concept. This link is a good start : http://www.yourmedievalfuture.com/?p=437 The asteroid mining news blurb was probably part of some disinformation campaign or an attempt to mislead the public perception on resource depletion issues. Or somebody might have been looking to dupe some investors. Questions for those mining guys : What concentration of valuable minerals are you expecting to find out there? Are those concentrations typical in meteorites that are already on the earth? If these minerals are embedded in rock or iron or manganese and impure and separation needs to be done then exactly which process is going to be used? Which machines and chemicals will you be taking to an asteroid? Do those processes work in zero gravity and zero atmosphere? How much tonnage are you bringing back per mission? What are the energy calculations for de-orbiting that mass? How big a heat shield will be needed? Shirley, someone must have done some calculations on weight, volume, and the amount of fuel to get out of orbit, get back, and de-orbit. Is the back of that envelope or that napkin still available? Or did it get tossed out after those "wannabe mining" guys ate lunch together? Talk about building a proverbial bridge to nowhere. Hope they are not going to be using government money for any funding. WAIT!!! That just might be it. Maybe they are just tring to divert some public funds to pad some corporations bottom lines with no real hope for a profitable business model. Wouldn't that be a swindle?

...I agree with most of what was said, but, not with ''person-hood-wink''. That's just dumb, but, I understand the point of order. My point, as in ''order'', is that in order to sustain the individual (personhood) and thereby maintain the ''whole body'' (market) in agreement with; life, liberty, freedom and justice for all, there must be balance. Nobody can say, with a straight face, that there is any evidence to support the Corporation's and the Public voice have equal footing, as it now stands. To suggest that the Trillion, Billion and Multi Million, ''Fiat Run'' borderless corporation and tax dodging scumbags Greece'n the Skid Row Your Boat down Love Canal is ''working'', well, that is strong delusion to be sure. That is BTFD Fukushima FUBAR ...and we need to have our ass kicked by the blowback of that wind, which is aaaah blowing all over the world right now.

Try again...

This is not a hard issue to resolve, but, the fact is, all the good that defines our great companies and the amazing growth for humanity, through good private capital ventures, has been compromised by the government and corrupt bastards hell bent on gains that are not in balance with the people. The reason being, ''their'' voice is too big and powerful ...and cannot be trusted to maintain the security ''of the individual'', meaning, even the company. Smell the ''vapor''! LMAO. That has been proven beyond the shadow of doubt (over and over) at this point. We have been watching the progression of this corporate voice failure, to secure, in a global way, big time. If you don't think so, just go read a really great site, think it's called Zero hedge.

This author is a donkey... YOUR QUESTIONS HAVE ALREADY BEEN ANSWERED HUNDREDS OF YEARS AGO... it's called limited partnerships... we should return to the era of three business types: sole proprietorship, partnership, and limited partnership. Limited liability can be accomplished via a limited partnership. If you want to also run the business, then you can be a general partner. It really is this simple. If you want to hedge liability, get insurance. From this point and this point forward, moral hazard and perverted incentive ensues.

The corporate form evolved for the same reason virtually all legislation does... a windfall to business interests... the rest was history.

PS, there is a difference between corporations and companies... just saying.

This essay is simple and fundamental, fine, in a high school economics kind of way, until the second to last paragraph. You are making an assertion to support the Citizens United decision that is not supported by the facts. Ultimately, the corporation doesn't own anything, all the assets are owned by the shareholders and the supposed rights afforded the coprporation are simply an extension of the rights of the shareholders. Your essay comes close to actually naming a main problem with corporations today, which is that the interests of the shareholders are being subjegated by management, who is running the corporation for his own benefit, with the assistance of boards and institutional investors who are benefiting as well. Corporate personhood is not necessary to limit liability or for corporations to perform in any way. To suggest that the existence of vibrant, advance economies is dependent on corporate personhood is laughable.

Charters of incorporation should only be issued for specific projects and for a specific time frame, like they were intended to be originally. LLCs are doomed, either people will awaken to the evil that we call corporations or the corporations will bite off the hand that feeds them. Today's corporations are nothing but a new incarnation of the robber barons of old, there is no justice for those who the corporations destroy, personal enrichment is the only focus of those in charge, there is no loyalty to the true producers on who's back the corporation rides, there is no admittance of any dependance on the consumer of whatever product or service the corporation provides, instead consumers, workers, and investors are defrauded pretty much daily and then propagandized as evil if they dare to question the intentions or actions of the corporation.

When I see propaganda pieces like this popping up I am encouraged because it shows that the corporations are starting to be concerned. Down with no responsibility, down with centralized business, down with conformity, down with corporations, down with Wall street, up with taking responsibility for your actions in business, up with private ownership, up with individualism, up with Main street.

>>Benito Mussolini coined the term for this system—fascism—though of course he did not regard it as the terminal stage of civilization.<<

Mussolini, ex-syndicalist, ex-socialist, lifetime anti-capitalist, was an exponent of corporatism, not corporations. In fact, he forced corporations into his corporatist organizations.

Corporatism, briefly, is compelling people and organizations into state-sponsored corporate bodies to reduce the administrative burden of commanding them.

Thus, there will be one union for all dockworkers which will send representation to the one union for all laborers which will have representation on the one union for all private sector workers, which pyramids upwards until the state can set wages and labor by negotiating with two or three "representatives."

With respect to our friend the corporation, the same consolidation takes place. First, all "unnecessary" competion will be phased out with British Leyland types of state-compelled mergers to enhance "efficiency" in production. Then, companies are organized into industries which select representatives to larger combinations of sector representation, and so on, until Mussolini has a handful of people he has to deal with to set industrial or commercial policy.

Instead of the state having to deal with a gazillion entities, each with its own needs and voice, under corporatism, society would be organized into units with the power to speak and negotiate for many.

See "Salo Republic" for the most extreme form of Mussolini's corporatism.

We're getting closer to corporatism all the time in the conduct of the presidency. The cabinet offices have embryonic representational functions similar to the corporations created by the fascist state.

Equal access and protection under a civil law system seems the ideal way to resolve virtually all of our problems. And yet, when people and corporations gain power they seemingly lose the ability to see needs beyond their own and to understand the concept of "fairness" (which is VERY different from equality) and consistently work to tilt benefits "unfairly" in their direction.

My own personal opinion is that people who are incapable of both maintaining power and fairness are abysmal leadership failures, unworthy of their position and should be disposed of in the most expedient manner within one's moral construct.

But today, the government is taking control over every facet of the economy: sector by sector, law by law, regulation by regulation, court decision by court decision, czar by czar, presidential diktat by president diktat.

That makes just about as much effing sense as Bernanke's support of the looney tunes Milton Friedman-Schwarz reason for the Great Depression, moron!

You got some problems in the reading department, stooge?

Wall Street-owned gov't, sonny, been going in that direction for 50 years and now it's simply a fact, jack!

I will first propose something that I think should not be controversial. The production of certain goods and services requires a large scale.

Possibly true-- HOWEVER, those "certain" goods and services requiring a large scale are things we can easily live without: skyscrapers, jumbo jets, superhighways, dams and other huge construction projects.

Manufacturing of almost any useful product can be done much better by networks of small businesses than by mega-corps. Iron, for example, can be produced in smaller scale blast furnaces; any gain in metallurgical efficiency afforded by larger plants is more than offset by the human costs of bureaucratic waste and management greed endemic to the accompanying social structures.

To take another example, the Linux operating system, created by volunteers working individually and in small groups, has developed into a product vastly superior to anything created by government-chartered corporations-- even while fending off petty attacks from manager types who resent the fact that Linux doesn't give them any way to feel important.

What you corporatists always forget is that the tremendous resources of the US were built entirely from scratch, in the early and middle parts of the 19th century, with practically NO involvement of corporations. In the 20th century, we became tragically fixated on big wars, big government, and big corporations, finally leading to the profound crisis we are in today.

I think the lost point in the article has more to do with the unaccountability of management that is created by the modern corporatist state. Managers, not entrepreneurs run billions and trillions of dollars through the economy with no stake in long term outcomes, no accountability for their actions, and a golden parachute for a gentle ride down after the inevitable fall. This is of course made possible because of the religious zealotry of the corporatist elite that refuses to question self interest, regulate greed, or practice accountability for their actions.

At the end of the day corporations are and have always been to governments what the monster was to Dr. Frankenstein. They are a fabrication of the state, a soulless entity that seeks to destroy its maker.

I missed one thing in the treaty, that's the psyche of a corporation. As it performs tasks on a big scale, yet one that can be reduced to tasks performed by individuals, shouldn't a corporation then perform these tasks with a sense of morality just like an individual does ?